Debt and Korea cause Stockholm market fall

Increasing concern about the European debt crisis and renewed tensions between North and South Korea caused share prices in Stockholm to fall sharply on Tuesday.

The OMXS index fell in opening trading and the negative pattern continued all day.

Like other European stock markets, the Stockholm exchange was spooked by bad news from the Spanish banking sector and new cutbacks in a number of European countries. Deteriorating relations between North and South Korea added to worries.

“Basically, worry about debts is getting more entrenched and there’s concern that the economic recovery will lose traction,” said Robert Bergqvist, chief economist at SEB.

At the close of trading, the OMXS index had fallen 2.5 percent to 292.7, taking it close to its lowest point this year.

Banks were hardest hit: Swedbank shares fell 4.8 percent to 66.80 kronor, SEB was down 3.5 percent to 39.10 kronor, Handelsbanken fell 2.1 percent to 184 kronor and Nordea fell 2 percent to 60.60 kronor.

Among major non-bank shares, Electrolux was a big loser, falling 4.7 percent to 167.10 kronor. Trelleborg fell 5 percent to 43.70 kronor, Ericsson fell 2.6 percent to 78.1 kronor and H&M was down 1.3 percent to 420.70 kronor.

The fall in Stockholm mirrored developments on other EU markets. London’s FTSE 100 index was down 2.5 percent, Paris’s CAC-40 was down 2.9 percent and the Frankfurt DAX was down 2.3 percent.

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Ericsson suspends all Russia operations indefinitely

Swedish network equipment maker Ericsson said Monday that it was suspending all of its Russian operations over the war in Ukraine for the foreseeable future.

Ericsson suspends all Russia operations indefinitely

The telecom giant already announced in late February that it would stop all deliveries to Russia following Moscow’s February 24 invasion of Ukraine.

“In the light of recent events and of European Union sanctions, the company will now suspend its affected business with customers in Russia indefinitely,” Ericsson said in a statement.

The company added that it was “engaging with customers and partners regarding the indefinite suspension of the affected business.”

“The priority is to focus on the safety and well-being of Ericsson employees in Russia and they will be placed on paid leave,” it said.

READ ALSO: How has Sweden responded to Putin’s war in Ukraine so far?

Hundreds of Western firms ranging from Ikea to Coca-Cola, Goldman Sachs and McDonald’s have stopped operations in the country since the invasion, with French banking group Societe Generale announcing Monday it was selling its stake in Russia’s Rosbank.

Ericsson has around 600 employees in Russia, and is a “major supplier to the largest operator MTS and the fourth largest operator Tele2,” a company spokeswoman told AFP, adding that together with Ukraine, Russia accounts for less than two percent of revenue.

As a result, the equipment maker said it would record a provision for 900 million Swedish kronor ($95 million, 87 million euros) for the first quarter of 2022 for “impairment of assets and other exceptional costs,” though no staff redundancy costs were included.
Ericsson is due to publish its first quarter earnings on April 14.